RFID market developments in Korea
Oct 25, 2004
During a research tour in East Asia, IDTechEx visited Korea to report on the progress of RFID there, which has truly developed at an impressive rate.
Existing markets for RFID include asset management (such as libraries), warehousing and by far the largest - transportation ticketing and epurse. Inline with global developments extensive trials are being carried out which include airline baggage tagging, pallet and case tagging and cargo tagging.
RFID suppliers and users in Korea felt that a mandate from retailers is unlikely, as in Japan. Retailers are more fragmented compared to those in the US or Europe, such that brands have more power and would be unlikely to accept additional costs by retailers. However, in 2005 supply chain management (SCM) is expected to become one of the fastest growing applications in Korea for two reasons. This first is the need to tag pallets and cases that Korea exports to countries where retailers have set a mandate; and second is the natural use of RFID for SCM as brands and consumer packaged goods (CPG) companies identify the rich paybacks and lessons of success from their experience of meeting mandates in other countries.
A key market emerging in Korea is the use of RFID and other wireless sensors and communications such as Zigbee and Ultra Wide Band (UWB) tags for consumer facing applications, such as cashless payments, smart houses and smart cities. A large fraction of the GDP of Korea is invested in construction - a phenomenal amount - required to cope with the speed of growth of South Korea. Dr Geunho Lee, a leading consultant on RFID in Korea, told IDTechEx that there is a huge interest to embed RFID functionality into new city constructions and consumer appliances. The payback is added value for consumers which they are prepared to pay for. Indeed, the Korean government wholly support this drive; in March 2004 the Korean government opened "Ubiquitous Dream", a museum in Seoul with a mock up "smart home". This includes an internet refrigerator which tells you what items are in the fridge, when they expire and can automatically order more; contactless security systems and wireless sensors (e.g. the movement of a human causes the lights to turn on etc) and smart laundry machines which read the tags on clothing to automatically set the type of wash required for that clothing. Among other exhibits, the museum also includes a mini supermarket where all products are tagged and are read by gates on checkout.
For a full report, inclduigncompany reports visits, case studies and standards in Korea, read the November issue of Smart Labels Analyst.